[AtlasBarfed]

If the people predicting re-onshoring of production are correct (same people are predicting generally the collapse of China from demographics, which is a tad dramatic), companies need to get used to paying more for labor.

Globalization is coming to an end. An unparalleled period of worldwide navigational stability and political stability enabled indirect access to labor markets of a vastly larger size. Why is that? Because the USA is increasingly not seeing value as the world's police, because increasing totalitarian aggression from China/Russia, from inevitable stress due to climate change.

There was also demographic bulges from the boomers in this period, compounded with both-parents/partners work that also increased the labor supply.

Re-onshoring manufacturing, combined with the demographic bombs in China, Korea, Germany, Russia and the lesser demographic shrinks virtually everywhere else will mean that labor supply will decrease, and companies better get used to paying the worker bees more and the financial wizard CEOs less.

You know, unless AI and Robotics waves their magic wand, but even then ... things are going to change.

[lizardking]

Found Peter Zeihan’s burner account ;)

[AtlasBarfed]

It definitely is a lot of Zeihan in there, but a lot of what he says is compelling. I don't necessarily buy the "pirates are coming" because the US abandons patrolling the high seas.

I think China can replace its demographic losses in the cities by pulling from the rural areas.

But... with the end of oil as a paramount geopolitical concern due to our domestic production and EVs/alt energy ... why would we keep 13 carrier groups around? WHy are we doing all this "free defense"? Why are we essentially allowing China to own our production and give them a massive technology transfer?

And China is definitely turning totalitarian and incompetent and there are real signs of distress coming out of the country.

Zeihan used to be mocked, but then we signed the chips-in-the-USA and batteries-in-the-USA and more "moving production to Mexico" stories in the news. So there is definitely some re-onshoring happening.

Zeihan also poo-poos alt energy and EVs, he doesn't seem to understand the economics of alt energy in LCOE terms or the recent developments in battery chemistry that free us from nickel/cobalt constraints.

Do you listen to anyone else interesting?

[slim]

  WHy are we doing all this "free defense"? Why are we essentially allowing China to own our production

you have it backwards. china is not owning your production, you are exploiting chinese labor. and it's not "free defense" you are bullying sovereign states with your army to extract submission to your exploitative economics

[AtlasBarfed]

That s the balance sheet bargain: cheap labor.

However, politically China owns your physical factories, and switching production if there's a war over Taiwan is not a two week sprint / 5 point ticket.